Published: Thu, March 15, 2018
Medicine | By Earnest Bishop

The key drivers behind U.S. healthcare spending may surprise you

The key drivers behind U.S. healthcare spending may surprise you

Americans spend almost twice as much on health care than other high-income countries, yet they have the lowest life expectancy, a new study reveals.

But commonly held beliefs for these differences appear at odds with the evidence, the study found.

Despite beliefs to the contrary, "the USA has lower rates of physician visits and days spent in the hospital than other nations", said the report.

"There's no doubt that administrative complexity and higher drug prices both matter - as do higher prices for pretty much everything in USA healthcare", said lead study author Irene Papanicolas of the London School of Economics and the Harvard T.H. Chan School of Public Health in Boston.

Regardless of whether the nation moves toward private healthcare (supported by Republicans) or single-payer healthcare (supported by Democrats), Jha explained that the high expenses need to be at the center of discussion. "These data suggest that numerous policy efforts in the USA have not been truly evidence-based".

Researchers found life expectancy in the USA was the lowest of 11 countries at 78.8 years old, while people in other wealthy nations are expected to live between 80 and 83.9 years.

While the country showed the highest spending, the USA scored lowest among all the countries in terms of life expectancy at 78.8 years. Medical procedures were similarly overpriced in the US, and American medical professionals also make significantly more money than their peers in other countries, according to the paper. The study also contradicts several common beliefs, such as the idea that America uses more healthcare services than peer countries (it actually has lower rates of physician visits and days spent in the hospital than other nations) and that the quality of healthcare is always lower than in other countries.

Belief: The U.S. provides too much inpatient hospital care.

Belief: The quality of health care is much lower in the USA than in other countries.

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Life expectancy in the US was the lowest, at 78.8 years, the study also found.

The study ultimately rejected the myths offered to justify the high costs such as "underinvestment in social programs, the low primary care/specialist mix, the fee-for-service system encouraging high volumes of care, or defensive medicine leading to overutilization".

Contrary to popular belief, high utilization of healthcare services and low spending on social services are not the main reasons for the costs and lack of efficiency.

"We know that the U.S.is an outlier in healthcare costs, spending twice as much as peer nations to deliver care". For example, researchers found the USA appears to have the best outcomes for those who have heart attacks or strokes, but is below average for avoidable hospitalizations for patients with diabetes and asthma. And per capita spending for pharmaceuticals was $1,443 in the US, compared with a range of $466 to $939 in other nations.

Contrary to other common beliefs about high United States healthcare spending, these data suggest that the following, in fact, did not seem to influence spending: an underinvestment in social programs, the low primary care/specialist mix, a fee-for-service system, or preventive medicine leading to overutilization.

The average salary for a general practice physician in the USA was $218,173, while in other countries the salary range was $86,607-$154,126.

But overall spending is far higher.

Professor of global health and senior author of the study, Ashish Jha from the T.H.

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